Because of the existence of extremely wealthy individuals, economic data concerning income is very skewed. Which statement regarding the distribution of income is correct?

Question

Question 2 options:

A. Due to the skew the median will be a better measure of center for this data than the mean

B. The standard deviation will be a good measure of spread for this data.

C. Each section of a boxplot will be about the same width.

D. Due to the skew the median is greater than the mean.

Answer 1

The correct statement regarding the distribution of income that is skewed by extremely wealthy individuals is:

A. Due to the skew the median will be a better measure of center for this data than the mean.

In a skewed distribution, particularly one that is right-skewed like income distributions often are due to a small number of very high incomes, the median provides a better representation of the typical income than the mean, as the mean can be disproportionately affected by extreme values.